I know this isn't exactly what you are looking for, but I thought I would throw it out there anyways...
Windows Server 2003 Standard Edition R2
Now I know you were probably wanting to go Linux and open source with a few objectives in mind.
Keeping the system as lightweight as possible. I really don't know how light weight a traditional Linux server operating system is, but the Windows Server 2003 only uses about 3GB on a full install and has all the tools you need to hit the ground running (FTP server, Web server, etc.).
Having a system run on older hardware. Linux systems are great in this sense, but the
hardware requirements of Windows Server 2003 are quite low in my opinion. I think the amount of Ram you have available may be iffy, but I am sure you can get a hold of an old 128MB stick of SDRAM from somewhere.
Then of course, not having to spend money on an OS and applications. Well the greatest part of all about Windows Server 2003 Standard Edition R2 is that Microsoft is offering it for free to college students (in the U.S. at least). Therefore, if you are a college student or know someone who is a college student and is willing to get it for you, it would be a great way to get a hold of some a great operating system that retails for $999.99 USD for absolutely free.
Here is a link to my previous Reader News post of the Dreamspark program:
DreamsparkOtherwise, if you still want to go linux. I really don't see how the run of the mill Ubuntu Server will hurt. If I was in your situation, I personally would try out a few different distributions and see which I like best.
No matter what, good luck and try to have fun...
keep on macKIN'
Cody
P.S. Can't wait to try your kernel installer. Hope it works...